CBPP Documents Low Overhead Costs
The Center for Budget and Policy Priorities (CBPP) has posted an article disputing presidential candidate Mitt Romney’s charge that most federal low-income spending goes for “overhead” and “bureaucrats.” He has endorsed a proposal that would eliminate the major programs that assist low-income households in the United States and turn the programs over to the states, while in most cases also cutting them.
But in fact, CBPP disputes and shows that for the biggest low-income programs, more than 90% of the funding goes directly to those benefitting from the programs.
Specifically, the data on the six major low-income programs are as follows:
- Medicaid. Federally funded administrative costs accounted for 3.8 percent of federal Medicaid spending in fiscal year 2010; the other 96.2 percent went for health care and long-term care for beneficiaries.
- SNAP (formerly known as food stamps). Federal administrative costs accounted for one-quarter of 1 percent of federal SNAP spending in 2010. Adding the federally financed portion of state administrative costs brings total administrative costs to 4 percent of federal SNAP spending.
- Housing vouchers. Some 0.3 percent of program dollars went for federal administrative costs, 8.7 percent went for the administrative costs of the 2,400 state and local public housing agencies (PHAs) that operate the program, and 90.9 percent went for rental assistance for low-income tenants.
- Supplemental Security Income (SSI). Some 92.8 percent of spending went for benefit payments to beneficiaries, with administrative costs accounting for the remaining 7.2 percent.
- School lunch and breakfast programs. Some 0.9 percent of federal spending went for federal administrative costs, while 1.6 percent went for federal support for state administrative costs. The rest, 97.5 percent, went to schools to subsidize their costs in operating the school meals programs.
- Earned Income Tax Credit. Over 99 percent of EITC dollars went directly to households receiving the EITC, with the IRS estimating that its administrative costs amounted to less than 1 percent of EITC costs.
Click here to read the full article.
